Taiwan cabinet okays DRAM dumping tariff against U.S. suppliers

TAIPEI, Taiwan -- Taiwan's cabinet this week approved a preliminary 61.85% dumping tariff against Micron Technology Inc. and other U.S. DRAM makers, but the action is expected to have little impact on the local marketplace or memory suppliers. The government is set to make a final decision in the case by January.

In Boise, Idaho, a Micron spokeswoman today said the firm had not yet received any word from the Taiwanese government. Micron has called the suit a spite action in retaliation for the U.S. firm's own dumping case in this country against Taiwan's DRAM producers.

Even now, some local chip executives scoffed that the case means virtually nothing, despite the fact it was filed by the Taiwan Semiconductor Industry Association.

"It's an emotional response," declared John Hsuan, CEO of UMC Group, the Hsinchu-based foundry company that produces DRAMs to start up and initially fill logic chip plants. "I don't see any reason for Taiwan to take this kind of action, because there will be no benefit for the local companies."

Local chip leaders concede that Micron can avoid paying any penalty duties on DRAM exports to Taiwan simply by shipping chips from its fabs outside the United States. However, Hsuan added that Micron does benefit from U.S. anti-dumping actions, which drives up its own stock prices while protecting the company's domestic DRAM business.

"The market should decide on pricing," insisted UMC's chief executive.

Even if Taiwan finally imposes a dumping tariff against Micron and other U.S. DRAM makers, the duties would be collected only for a four-month period. Some Taiwan chip managers believe the action is intended to put the local industry on the same playing field as other global suppliers. Micron and Taiwan's industry traded barbs at a recent hearing on the matter by the International Trade Commission (see Oct. 20 story).

The U.S. Department of Commerce has made a final ruling imposing penalty duties ranging from 8.21% to 69% against Taiwanese DRAM producers. The ITC will rule by Nov. 18 whether the U.S. industry has been injured. An affirmative vote would mean dumping penalties would be imposed retroactive to May.